Saturday, December 31, 2011

Financial Year in Review

Since this is the last day of 2011, I decided to do my monthly/yearly net worth calculation as well as year end % gain/loss in our retirement/stock accounts.  Since the results were worse than expected, I wanted to get them out there today on the last day of the year to start the year out fresh and look forward to better things in 2012!

First off, utilizing the S&P 500 as the benchmark, the stock market started and ended the year at the same level.  That is so hard to believe with all the volatility over this year with the Euro crisis that we finished exactly where we started.  In actuality it was 1257.64 on Jan 1 2011 and it ended at 1257.60, so to be fair the market was down 4 cents for the year.  But basically the market returned 0% for the year.  That is your benchmark.  So to determine if you did well relative to the overall market, you need to compare your rate of return for the year to 0%.

Looking at all of our accounts here are our results for the year:

My 401K  -3.7%
My Trading Account  -5.8%
My Roth IRA  -4.4%

Wife 401K  -19.48%
Wife Roth IRA  -2.7%

So, as you see the results did not do well relative to the 0% return of the overall market.  Overall the numbers aren't particularly troubling for me except for that one -19.48% for my wife's 401K.  Looking further we had put all of the contributions in the mutual fund MPEGX.  That is a Morgan Stanley Mid-Cap Growth fund.  Taking a look at most of the growth funds available in my wife's account, for the period ended Sept 30th, most were around the same % loss as this fund or worse.  I am going to research all of those funds again and probably move out of that fund and into another less volatile fund.  I don't like the long term chart on that one.

Overall my wife's Roth IRA performed the best and her account is in the Vanguard target date 2045 fund VTIVX.  Which is a much better looking chart minus the precipitous decline when the bottom dropped out of the market in the recession of 2008/9.  So that tells me that it is true, that overall those Vanguard very low fee, target date funds are very good investments and I'm very happy with those for our Roth IRAs.  Mine is in the slightly more aggressive VEXMX.  It was an experiment on my part to see which performs better and she beat me out there.  I may swap mine over to VTIVX.

NetWorth wise I wasn't super happy with the results either.  I think I mentioned in my first post about NetWorth that I would be keeping track of things on a month by month basis and would only change the value of our house and vehicles at the end of each year.  Our car values are actually the same as they were last year, so no change there.  The house however surprisingly lost 10k in value.  I say surprisingly, because I checked 2 or 3 times during the year and it had actually inched up at one point.  But it is what it is, nothing we can really do about that.  So with that 10k decrease, the declines in our retirement accounts and just the regular numbers with amount of $ going out vs coming in, our overall NetWorth went up 8.7%.  Much better than 0 or negative, but in terms of actual $$ increase I was surprised it wasn't higher.

At any rate, that's a snapshot of 2011 and I'm looking forward to putting that behind us and looking forward to a hopefully much better year financially in 2012 and wish the same for you as well!  If you have any specific questions or comments about what I mentioned above, please leave a comment or drop me an email at  I am very interested to hear how your results for 2011 compare.  It's way too nice out with a temperature of 75 degrees here and all sun and it's time to stop checking numbers and head to the beach to enjoy the last day of 2011!  HAPPY NEW YEAR!!


Jen said...

My 401k is down -4.7 and david's is down -5.4. We are about to open full funded roth ira's so no news to report there.

Chris said...

I'd highly recommend Vanguard for the Roth IRA and their super low fee target date funds that I mentioned above. Just pick whatever year more closely matches when you plan to retire.

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